Northland cuts Toro stock rating following guidance reduction

On Friday, Northland analysts downgraded Toro stock (NYSE: TTC) from Outperform to Market Perform. The decision came after Toro reported mixed second-quarter results for fiscal year 2025 and reduced its full-year guidance. Despite generating $4.5 billion in revenue over the last twelve months and maintaining a healthy 33.5% gross margin, the company cited weakening residential demand and tariffs as reasons for the guidance cut. According to InvestingPro analysis, Toro currently appears undervalued based on its Fair Value metrics.

The analysts also lowered the price target for Toro stock to $80 from a previous target of $100. Trading at $73.30 with a P/E ratio of 19.27, the stock offers a 2.07% dividend yield, with InvestingPro data showing the company has maintained dividend payments for 42 consecutive years. The downgrade reflects the firm’s assessment of the company’s current market position and potential future performance.

Toro’s second-quarter results showed mixed performance, prompting the revision in expectations for the fiscal year. The company had to adjust its guidance due to challenges in the residential sector and the impact of tariffs.

Despite the downgrade, Northland analysts noted that they see little downside risk to Toro’s shares from current levels. The assessment suggests that the stock may remain stable despite the revised guidance and rating.

Toro’s shares have been under scrutiny as the company navigates these market challenges. The changes in rating and price target highlight the ongoing adjustments within the industry.

In other recent news, Toro Company has announced its financial results for the second quarter of 2025, which revealed a mixed performance. The company exceeded earnings expectations, reporting an adjusted earnings per share (EPS) of $1.42, surpassing the forecasted $1.38. However, Toro’s consolidated net sales were slightly below projections at $1.32 billion, compared to the anticipated $1.35 billion, marking a modest year-over-year decline. The Professional segment showed growth, while the Residential segment experienced an 11% decline in sales. Toro has also implemented significant operational cost-saving measures to navigate current economic challenges. Analyst firms have not provided upgrades or downgrades in recent reports. Additionally, the company is optimistic about its Professional segment, driven by infrastructure and data center projects, and has set its full-year adjusted EPS guidance between $4.15 and $4.30. These developments reflect Toro’s ongoing efforts to manage macroeconomic headwinds and leverage its market position.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.